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We present a basic design rule for reducing the light output power penalty in 1.3-μm InP-based strained layer (SL) multiple-quantum-well (MQW) lasers at elevated temperatures. The power penalty is shown to have a strong correlation with a critical temperature (T/sub c/): above T/sub c/, the power penalty rapidly increases due to a significant reduction in differential quantum efficiency. It is indicated that T/sub c/ can be estimated for an arbitrary laser structure by using a self-consistent numerical method. We show that, to minimize the power penalty, it is essential to design an SL-MQW laser so that its T/sub c/ is larger than the required maximum operation temperature.